Steve Walker, CIO & COO, DHL Supply Chain Asia Pacific
Of the disruptive technologies that are changing the face of the logistics industry, the Internet of Things (IoT) has been one of the most talked about because of the promise it brings of providing visibility and unlocking value for customers. While that value is starting to be delivered, at DHL we believe there is much more to come and we’re therefore developing a common IoT platform across the Group to exploit the possibilities.
Today we are seeing a fourth industrial revolution – one that has been coined ‘Industry 4.0’ - which is built around the use of automation and data connectivity in manufacturing technologies. This combination of trends and new technologies is changing the way that nearly all goods are made - with clear knock-on effects for supply chains everywhere.
At DHL part of our response to Industry 4.0 has been to embed an agenda of digitalization in the business. We aim to maintain our leadership of the logistics industry by delivering innovative, cost-efficient solutions for our customers.
In our operations in the Asia Pacific region, the Internet of Things is one of the focus trends that we’re working on.
Transforming 3PL decision-making
The Internet of Things (IoT) has the potential to connect virtually anything to the Internet and accelerate data-driven logistics. Everyday objects can now send, receive, process, and store information, and therefore actively participate in self-steering, event-driven logistics processes.
Connected warehouses can increase the transparency and localization of all assets through the tagging of individual items, pallets, and operational hardware.
These smart objects can transmit information about their current order, content, and location, enabling automated inventory management with real-time visibility on inventory levels and item conditions.
In recent years, as sensor and analytics technology have dropped in price and are becoming more embedded throughout logistics businesses, companies have begun to enjoy unprecedented visibility into operations, enabling new sources of value. This visibility, in turn, is transforming how logistics providers make decisions, including about how goods are stored, monitored, routed, serviced, and delivered to customers, as well as operational health and safety practices.
Warehouse safety improvement
The promise of delivering a safety improvement was what led us to first conduct a proof of concept in our Advanced Regional Centre in Singapore, and explore how we could operate IoT within a warehouse environment.
Through the use of wearables, we aimed to track employees as they moved about the warehouse – whether on foot, or on a vehicle such as a forklift truck. We established a system whereby if a forklift truck came within two meters of another truck or a pedestrian a proximity alarm would sound, enabling the operator to stop the vehicle.
We also fitted operators with heart rate monitors. After correlation of the data, we established that we were much more likely to get a close proximity alert after lunch, when heart rates are reduced and people can become lethargic.
This proof of concept meant that we were not only able to educate the workforce about the enhanced safety issue that followed lunchtime, but also demonstrated the effectiveness of this system of proximity alerts via wearables.
A connected warehouse
The success of that trial enabled us to begin work on a second phase of the project, which encompasses not just safety improvements but also delivers productivity benefits and makes the warehouse more connected.
In our Advanced Regional Centre warehouse in Singapore, IoT technology is embedded for a customer with heat map functions, serving as a real-time location system (RTLS) solution that automatically identifies and monitors the interactions of inventory, equipment, and people.
Statistics gathered from the live reporting are tracked through pre-assigned asset-tags. These provide higher resolution data and heat maps, allowing the warehouse team to gather insights on factors such as safety, traffic build-up, and workflow efficiency analysis.
The technology encourages an ongoing safety behavior and culture. It helps to determine if all personnel are accounted for in the event of an emergency, prevents accidents through automatic reporting on any proximity hazards and improves safety by prompting alerts when unusual activity is detected on the asset-tag
It means that supervisors are now in a position to have factual conversations – informed by data - with their direct reports about safety issues. That’s crucial to improving morale in the warehouse.
Aside from boosting safety standards in the warehouse, the IoT technology also distinguishes security breaches, and helps to streamline operations, combat congestion and optimize aisle product placement, thereby driving higher productivity.
In essence, this is about understanding where people are in the warehouse, optimizing what they’re doing, and becoming more productive and efficient in how we serve our customers.
Unique IoT platform
At DHL, we are leading the way in our use of IoT in the industry. That leadership position is currently being reinforced by our development of a common IoT platform across the business, something that is unique amongst logistics providers.
The platform, which is shared across all our divisions, will allow us to manage, take advantage of, and realize the value of IoT advancement. It positions us to leverage economies of scale for procurement and deployment and promote re-usability and full collaboration across all our initiatives.
It provides the flexibility to onboard and manage the devices of multiple vendors, while at the same time putting a strong focus on security.
Finally, it manages the data in the central repository of DHL’s Data Lake, opening up new possibilities to further extract new insights by creating and running advanced analytics.
The platform is a further step in our development of smart warehouses – ones in which we can see, understand and optimize processes - leading to improvements in operational efficiency, increased transparency, optimization of resources and improved process quality and performance on behalf of our customers.